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Quanta Services, Inc. (NYSE:PWR)
Beneish M-Score
-2.53 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Quanta Services, Inc. has a M-score of -2.53 suggests that the company is not a manipulator.

PWR' s 10-Year Beneish M-Score Range
Min: -3.06   Max: -1.58
Current: -2.53

-3.06
-1.58

During the past 13 years, the highest Beneish M-Score of Quanta Services, Inc. was -1.58. The lowest was -3.06. And the median was -2.53.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Quanta Services, Inc. for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9835+0.528 * 0.9789+0.404 * 1.0661+0.892 * 1.1018+0.115 * 1.1101
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0456+4.679 * -0.027-0.327 * 1.0509
=-2.53

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $1,439 Mil.
Revenue was 1817.623 + 1645.132 + 1474.377 + 1585.71 = $6,523 Mil.
Gross Profit was 302.843 + 273.053 + 241.284 + 238.273 = $1,055 Mil.
Total Current Assets was $2,313 Mil.
Total Assets was $5,793 Mil.
Property, Plant and Equipment(Net PPE) was $1,206 Mil.
Depreciation, Depletion and Amortization(DDA) was $162 Mil.
Selling, General & Admin. Expense(SGA) was $501 Mil.
Total Current Liabilities was $1,044 Mil.
Long-Term Debt was $0 Mil.
Net Income was 166.697 + 92.906 + 70.237 + 72.081 = $402 Mil.
Non Operating Income was 113.299 + -0.824 + -0.353 + -0.513 = $112 Mil.
Cash Flow from Operations was 201.492 + 83.192 + 117.776 + 44.132 = $447 Mil.
Accounts Receivable was $1,328 Mil.
Revenue was 1673.342 + 1532.001 + 1386.162 + 1328.764 = $5,920 Mil.
Gross Profit was 286.739 + 252 + 212.904 + 186.064 = $938 Mil.
Total Current Assets was $2,202 Mil.
Total Assets was $5,141 Mil.
Property, Plant and Equipment(Net PPE) was $1,046 Mil.
Depreciation, Depletion and Amortization(DDA) was $158 Mil.
Selling, General & Admin. Expense(SGA) was $435 Mil.
Total Current Liabilities was $881 Mil.
Long-Term Debt was $0 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1439.115 / 6522.842) / (1328.081 / 5920.269)
=0.22062699 / 0.22432781
=0.9835

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(273.053 / 5920.269) / (302.843 / 6522.842)
=0.15838926 / 0.16180876
=0.9789

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2313.318 + 1205.608) / 5793.245) / (1 - (2201.727 + 1045.983) / 5140.757)
=0.39258119 / 0.36824285
=1.0661

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=6522.842 / 5920.269
=1.1018

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(157.994 / (157.994 + 1045.983)) / (161.625 / (161.625 + 1205.608))
=0.13122676 / 0.11821321
=1.1101

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(501.01 / 6522.842) / (434.894 / 5920.269)
=0.07680854 / 0.07345849
=1.0456

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((0 + 1043.52) / 5793.245) / ((0 + 881.179) / 5140.757)
=0.18012703 / 0.17141036
=1.0509

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(401.921 - 111.609 - 446.592) / 5793.245
=-0.027

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Quanta Services, Inc. has a M-score of -2.53 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Quanta Services, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.08221.06071.01131.0510.77640.9861.0181.08390.98010.9835
GMI 1.0910.80660.93270.91830.96120.9391.10121.21270.84560.9789
AQI 0.99590.92260.80662.01840.94380.94431.04110.99950.86741.0661
SGI 0.99011.13261.14511.2591.42330.87781.09381.15551.41171.1018
DEPI 0.92220.98661.01181.33160.83411.18470.9611.03630.98211.1101
SGAI 0.97960.95940.85011.05260.90391.15040.90090.94970.91191.0456
LVGI 0.98360.97021.00220.58280.60650.93690.76261.4421.03121.0509
TATA -0.1067-0.0342-0.0295-0.0244-0.024-0.0523-0.0186-0.01810.0386-0.027
M-score -2.87-2.58-2.57-1.78-2.34-2.89-2.31-2.37-2.08-2.53

Quanta Services, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.24671.08391.15931.07371.32510.98011.14810.90790.65870.9835
GMI 1.28181.21270.98340.93850.91670.84560.90380.89660.91310.9789
AQI 1.08570.99950.9820.95980.90720.86740.87530.8761.02231.0661
SGI 1.02761.15551.25291.30441.36131.41171.32171.2411.19671.1018
DEPI 1.23011.03631.05991.04161.02170.98210.98971.00711.03471.1101
SGAI 0.96220.94970.86330.84750.83540.91190.98961.03881.03741.0456
LVGI 1.19571.4421.43681.43151.3691.03121.00380.91810.87851.0509
TATA -0.057-0.01810.00720.00780.03460.03940.02430.019-0.0084-0.027
M-score -2.34-2.37-2.20-2.26-1.87-2.08-2.04-2.34-2.66-2.53
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